Seven Spanish agents were killed and one wounded in an ambush south of Baghdad on Saturday, the BBC quoted the Spanish defence ministry as saying.

It said a journalist who passed the scene said he saw bodies lying in the road and two vehicles ablaze.

The eight-member team was attacked near the town of Hilla, as its convoy returned from a mission.

CNN quoted witnesses as saying that one or two cars followed the Spaniards who were traveling in two four-wheel drive vehicles. They were fired on by gunmen in the cars and by people on the side of the road.

Spain currently has 1,000 peacekeeping troops deployed in the country.

The attack came at the end of a month that has seen the most killings of US-led coalition forces since the war began.